History
The first Starbucks opened on March 30, 1971 in Seattle, Washington. Three friends from the University of San Francisco created this brand in hopes of selling coffee beans; however, what they created was a lifestyle. Jerry Baldwin, Zev Siegl, and Gordon Bowker created Starbucks coffee after being inspired by Alfred Peet, the creator and inventor of Peet's Coffee.
The three friends original goal was to sell quality grown roasted coffee beans. These coffee beans that were sold were actually bought from Alfred Peet, their inspiration for their store. The first stores only sold the actual coffee beans, not brewed coffee, for that invention did not come until much later.
After being inspired and creating their vision. A name had to be created for their store. The trio went back and forth on deciding names until they finally reached the final name, Starbucks. The name "Starbucks" refers to the chief mate Starbuck in the novel "Moby Dick". The trio decided on this name because not only was it inventive, the novel was their favorite (Starbucks).
Current Products
-Hot/Cold Beverages -Snacks -Sweets -Pastries -Sandwiches -"My Starbucks" Loyalty Program (2008) -Teavana Tea (2012) -"Skinny" Non-Fat Line (2008) -"Via Ready Brew Instant Coffee" (2009) -Beer & Wine (2010) -Cold Trenta Size Cup (2011) -"Verismo" Single Serve Coffee Maker (2012) (Starbucks) |
Geographical Locations of Production, Sales, & Customers
Starbucks in an international company, serving coffee all around the world. Their coffee is in stores in six of the seven continents in the globe. The earliest international stores dates back to 1996, with the store entering in Japan. Ever since then, stores have been launching in several other countries such as Russia, Peru, England, and most recently Colombia and Vietnam. In addition to actual international stores, in 1999, Starbucks Cafes were introduced in places such as airports, churches, grocery stores, and schools. These cafes are also international; however, more prevalent in the United States. Starbucks does more internationally speaking then just selling coffee in stores, they buy quality green coffee beans from accredited sources in countries such as Switzerland (Starbucks). |
Culture of the Company
Starbucks has created a whole new culture in society. There is a thread on Twitter saying, "#Common White Girl" and "#White Girl Probs." These hashtags were created partly due to the Starbucks brand. The epitome of this hashbag is a Starbucks beverage, specifically a carmel machiatto, or in the fall, pumkpin spice lattes. Starbucks has created a whole new revolution that was not intented, it just happened on its own. |
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Rating the Three Levels
In regards to the three levels discussed in our handout, this company emphasizes a great deal on ethical behavior and CSR. Yes, corporate governance is important and talked about; however, it is not the main focus of the company. Starbucks exemplifies ethical behavior through it's coffee, tea, and manufacturing of goods. This company strides itself on being one of the best, if not the best ethical coffee and tea importers and local good manufacturing company. CSR is also a huge factor in this company. CSR goes hand and hand with ethical behavior because in the categories of CSR, Starbucks is ethical. Ethics is the driving force behind this company since the day the trio of friends decided to sell quality coffee beans (Rees). |
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Triple Bottom Line
The triple bottom line, "TBL" is defined as an accounting framework that incorporates three main areas: financial, social, and environmental. In regards to this company, the TBL is not explicitly stated, it is more subtle when talking about the subject and often referring to the three areas when dealing with CSR. The areas on social, financial, and environmental framework is extensively talked about individually in the company's annual reports. This report is the CSR report that is produced annually by the company for employees, stock holders, and customers. The TBL works hand in hand with CSR, which is why it is so heavily incorporated in the report (Slaper). |
Corporate Social Responsibility
In regards to Starbucks' corporate social responsibility CSR, it is categorized by a mixture between ethical and altruistic natures. The Starbucks Corp. has a sincere nature in wanting to help others globally. This sincerity is coming straight from the heart, with absolutely no alteior motives. CSR is mentioned excessively in their CSR Annual Report and mentions several topics including the community, global reporting, the environment, and ethical sourcing.
The community side of CSR is talked about in length. Starbucks does many things for the community with the most important for our current economic state, creating jobs. Because there are so many stores globally, Starbucks is employing many people of all economic and social statures. Additionally, the company has the Starbucks Foundation which is a community service based foundation that creates and implements literacy programs in the United States and Canada.
Environment wise, Starbucks prides itself on the fact that all of their stores are LEED certified. That means that their carbon footprint is being significantly reduced by using quality measures to help our environment. All stores also use Energy Star appliances for their coffee creations that allows for not only a cheaper PG&E bill, but also for clean energy to be created. Similarly, all energy that in used by machines in the store is renewable energy. This allows for clean energy to be created that also helps the environment. Finally, all stores use clean water filtration systems, have recycling bins both inside and outside for employees and customers, and offers reusable coffee mugs for a cheap price of one dollar.
The next area, ethical sourcing, was created for the company's holistic approach for coffee practices and conservation programs. Starbucks practices CAFE: coffee and farmer equity. This means that the company is ensuring that the coffee is quality coffee while promoting the TBL standards. There is a similar practice set in place for there tea as well. In 2005, the Ethical Tea Partnership was formed to ensure that their tea is being produced in a socially responsible way. These two practices ensure that their two main products, coffee and tea, are being ethically grown for their customers. Additionally, Starbucks collaborates with other foundations such as the World Cocoa Foundation and the Bill & Melinda Gates Foundation to support cocoa livelihood programs in West Africa. Finally, in regards to their manufactured good, there are specific standards set in place to ensure ethical sourcing. There are several audits for the factories and if they do not meet the minimum standards, they will be shut down until they can properly and ethically create the materials.
The Global Responsibility Report is an annual report that tells the shareholders, customers, and employee how the above three areas are doing. It is more of a progress report that compares the current year to previous years in order to see what works and what does not (Starbucks).
In regards to Starbucks' corporate social responsibility CSR, it is categorized by a mixture between ethical and altruistic natures. The Starbucks Corp. has a sincere nature in wanting to help others globally. This sincerity is coming straight from the heart, with absolutely no alteior motives. CSR is mentioned excessively in their CSR Annual Report and mentions several topics including the community, global reporting, the environment, and ethical sourcing.
The community side of CSR is talked about in length. Starbucks does many things for the community with the most important for our current economic state, creating jobs. Because there are so many stores globally, Starbucks is employing many people of all economic and social statures. Additionally, the company has the Starbucks Foundation which is a community service based foundation that creates and implements literacy programs in the United States and Canada.
Environment wise, Starbucks prides itself on the fact that all of their stores are LEED certified. That means that their carbon footprint is being significantly reduced by using quality measures to help our environment. All stores also use Energy Star appliances for their coffee creations that allows for not only a cheaper PG&E bill, but also for clean energy to be created. Similarly, all energy that in used by machines in the store is renewable energy. This allows for clean energy to be created that also helps the environment. Finally, all stores use clean water filtration systems, have recycling bins both inside and outside for employees and customers, and offers reusable coffee mugs for a cheap price of one dollar.
The next area, ethical sourcing, was created for the company's holistic approach for coffee practices and conservation programs. Starbucks practices CAFE: coffee and farmer equity. This means that the company is ensuring that the coffee is quality coffee while promoting the TBL standards. There is a similar practice set in place for there tea as well. In 2005, the Ethical Tea Partnership was formed to ensure that their tea is being produced in a socially responsible way. These two practices ensure that their two main products, coffee and tea, are being ethically grown for their customers. Additionally, Starbucks collaborates with other foundations such as the World Cocoa Foundation and the Bill & Melinda Gates Foundation to support cocoa livelihood programs in West Africa. Finally, in regards to their manufactured good, there are specific standards set in place to ensure ethical sourcing. There are several audits for the factories and if they do not meet the minimum standards, they will be shut down until they can properly and ethically create the materials.
The Global Responsibility Report is an annual report that tells the shareholders, customers, and employee how the above three areas are doing. It is more of a progress report that compares the current year to previous years in order to see what works and what does not (Starbucks).
Evolution/Revolution of the Company
From the very beginning, the founders of Starbucks sought to be an ethical company. They started off small by only selling quality coffee beans from Peet's that were ethically grown. This desire for ethically sourced products only grew into a much bigger concept when the creation of brewed coffee and tea came about. Board members have recently stated that looking back, some of the coffee beans were not as good as quality that the current beans are. However, this is due to the technology that we have now that we did not have years ago. This company has evolved into a much more ethical company, but even from the beginning, it had great motives and intentions. |
Corporate Governance
Starbucks has a very effective corporate governance as shown by their lengthy reports on their main website. The six steps that Ghillyer uses in his business book are demonstrated by their six corporate governance manual style materials. Their corporate governance page also includes materials for their board committee charters, directors and officers, and their stance on the National Health Care Reform (Webber). Walter Salmon proposed twenty two questions for evaluating and diagnosing the board. These questions are used to access the quality of the board's performance. Question four asks if the board is the correct size (8-15 members). The Starbucks Corp. is the correct size of thirteen members with the CEO Howard Schultz also serving on the board (Starbucks). Having Schultz be both CEO and a chairman on the board can cause some problems in the long run. There could be a slight conflict of interest because Schultz might only be looking out for the short term budget goals compared to long term. However, on the other hand, Schultz knows the ins and outs of the company so his levels of effectiveness will significantly increase (Ghillyer). |
Works Cited
Ghillyer, Andrew. Business Ethics Now. New York: McGraw Hill, 2012. Print.
McDevitt, T.M., and J.E. Ormrod. "Kohlberg's Three Levels and Six Stages of Moral Reasoning." Education.com. Ed. Danielle Wood. N.p., 20 July 2010. Web. 1 Nov. 2013. <http://www.education.com/reference/article/kohlbergs-moral-reasoning/>.
Rees, Caroline, Deanna Kemp, and Rachel Davis. "Corporate Culture." Harvard Kennedy School. Ed. Jane Nelson. Harvard University, Sept. 2012. Web. 1 Nov. 2013. <http://www.hks.harvard.edu/m-rcbg/CSRI/index.html>.
Slaper, Timothy F., Ph.D, and Tanya J. Hall. "The Triple Bottom Line: What Is It and How Does It Work?" Indiana Business Review. Ed. Carol O. Rogers and Rachel M. Strange. Indiana Business Research Center, 2011. Web. 1 Nov. 2013. < <http://www.ibrc.indiana.edu/ibr/2011/spring/pdfs/article2.pdf>.
Starbucks. N.p., n.d. Web. 11 Nov. 2013. <http://www.starbucks.com>.
Webber, Bruce. "Corporate Governance Defined." Corporate Governance. Ed. James McRitchie. CorpGov.net, 2005. Web. 1 Nov. 2013. <http://corpgov.net/library/corporate-governance-defined/>.
Ghillyer, Andrew. Business Ethics Now. New York: McGraw Hill, 2012. Print.
McDevitt, T.M., and J.E. Ormrod. "Kohlberg's Three Levels and Six Stages of Moral Reasoning." Education.com. Ed. Danielle Wood. N.p., 20 July 2010. Web. 1 Nov. 2013. <http://www.education.com/reference/article/kohlbergs-moral-reasoning/>.
Rees, Caroline, Deanna Kemp, and Rachel Davis. "Corporate Culture." Harvard Kennedy School. Ed. Jane Nelson. Harvard University, Sept. 2012. Web. 1 Nov. 2013. <http://www.hks.harvard.edu/m-rcbg/CSRI/index.html>.
Slaper, Timothy F., Ph.D, and Tanya J. Hall. "The Triple Bottom Line: What Is It and How Does It Work?" Indiana Business Review. Ed. Carol O. Rogers and Rachel M. Strange. Indiana Business Research Center, 2011. Web. 1 Nov. 2013. < <http://www.ibrc.indiana.edu/ibr/2011/spring/pdfs/article2.pdf>.
Starbucks. N.p., n.d. Web. 11 Nov. 2013. <http://www.starbucks.com>.
Webber, Bruce. "Corporate Governance Defined." Corporate Governance. Ed. James McRitchie. CorpGov.net, 2005. Web. 1 Nov. 2013. <http://corpgov.net/library/corporate-governance-defined/>.